Longtail Wars

How Book Publishing Suddenly Has the Upper Hand
With Some of the Biggest Technology Companies in the World

Having just returned from Frankfurt and participated in the obsessive focus on digital issues there, it occurred to me that the publishing industry today is in a position rarely if ever experienced before; we suddenly have the upper hand. To wit, there are three wars that are raging today (and one on the horizon) which are changing the nature of publishing and putting us in the drivers’ seat; discoverability, Print on Demand (POD), and repositories.

All of these wars revolve around the notion of longtail, which is the theory that the optimized search capabilities of the internet provide nearly endless access to otherwise obscure products and that the demand for these obscure products exceeds demand for bestsellers. Longtail is in effect the holy grail of this industry because with each new season of frontlist our backlist grows exponentially. Longtail in book publishing is about selling books we no longer actively promote. With that in mind, here is my report from the front lines.

Discoverability Wars

I have written a fair bit on the notion of discoverability – but to be honest, to date it has been less of a battle and more of a spat between Google and Microsoft. Google was first and by some estimates has 10 times the titles currently available on Live Search Books – not to mention an enormous lead in the search market. Microsoft is a distant third in the search category which has hampered the book search efforts to date. However, Microsoft has recently shown a significant push into this market and with their market cap and cash reserves are very able to make huge inroads with publishers very quickly.

This is good news for publishers as competition breeds new opportunities and motivates both parties to play to our needs, not theirs. There is no way that a strong Microsoft doesn’t influence Google’s behaviors with publishers – be it as partners in search or in the courts. Furthermore, Microsoft isn’t getting into this space just because they feel like throwing away money – they are in this to win the search war. This is a small battle front today, but with one acquisition – say Yahoo, which combined with Microsoft, would own 30%+ of search traffic to Google’s 50%+. One move and suddenly Live Search is a player with attitude. Watch this space!

Print on Demand Wars

There has been an explosive growth in the area of Print on Demand – driven in part by the sudden need for titles that are being found through discoverability programs in ways never before possible. In this space you have two very interesting competitors; Ingram and Amazon. This is especially interesting when you realize how closely Amazon and Ingram work together. If you are fortunate enough to get a tour of Ingram’s awe-inspiring facilities in the Nashville, Tennessee area you will see thousands of orders speeding through Ingram which are shipped in boxes bearing the (all too familiar in my house) Amazon logo. This fascinating customization service offered by Ingram is a key to Amazon’s ability to deliver to almost any customer, almost anywhere, what they ordered in nearly any time frame they need it.

Part of this service currently involves POD, which Ingram does through their Lightning Source service. However, Amazon purchased Booksurge a couple of years back and has now geared it up to compete head on with Lightning. This is an interesting turn for publishers who, like in the discoverability battle, are seeing immediate benefits from this competition. Both sides are making huge technical and business improvements and offering publishers better and better terms and opportunities. What will be very interesting to watch is how Ingram manages the threat of all POD titles available in Booksurge as well as Lightning Source as Amazon will obviously push their own service. Will BN.com and the forthcoming Borders.com ultimately gain from Ingram’s need to replace their Amazon volume? Again, stay tuned here.

Repository Wars

From the publishing side there has been a lot made of how discoverability initiatives have created the demand for content that publishers aren’t sure how to manage. Longtail isn’t what we are used to and keeping flexible inventory and access to content in a variety of forms, that may or may not be wanted or found, is causing a significant push for massive content repositories. These repositories not only contain digital files for ebook distribution, they can contain POD files, audio files, and offer widgets for partial content access on thousands of sites globally without any human intervention. These repositories (yes, Brian Murray, I have changed my tune – you were right) will allow publishers large and small to optimize their ability to get content out there, discoverable, controlled, and sold in any format the consumer wants or needs.

There are two key players in this space (Random House is a third, but who is likely to work with a competitor?), LibreDigital and CoreSource. LibreDigital is owned by NewsStand, a huge repository provider in the newspaper space. HarperCollins and Hachette have partnered with Libre on their repositories. CoreSource is a part of Ingram Digital and has been selected by Holtzbrinck (now Macmillan) to build their repository. Both services are actively pursuing publishers somewhat aggressively. It’s clear that Libre has an edge in experience while Ingram will certainly have an edge in the end to end solutions offering as POD and print distribution are their strengths. What is emerging is a whole new set of options for publishers as simple digital archives may no longer provide enough services. I expect at least one more vendor to enter this fray – it could be Amazon or it could be one of the larger India based services. This is definitely heating up!

Future Wars – e-ink readers

Sony jumped out of the gate fast with a somewhat slick but feature-poor device. (Yes, I know there was the iRex iLiad before it, but seriously, did anyone care?) Furthermore, Sony launched with only fiction titles and a less than inspiring list to boot. However, Sony has been making the rounds with renewed vigor and is working to dramatically improve their title offering. This comes on the heels of the worst kept secret in publishing, revolving around a certain mega-etailer launching their own device, and Steve Riggio of Barnes and Noble quoted in the NY Times as looking into developing and selling their own affordable e-ink reader. All this will soon add up to a full scale war for our content.

Taken alone, these wars are very important and extremely interesting. Taken together they are may very well change the face of our industry and offer us an amazing amount of leverage and flexibility in moving into the digital age with the greatest advantage – we have the content.

There is a virtuous circle at play here: Discoverability has led to the sale of deep backlist, which has led to the need to make more content accessible, which has led to repositories storing POD and ebook formats and feeding discoverability services, which in turn create the longtail sales. Pfew!

Longtail is the ghost in the machine helping us. It’s their wars – we are just winning it.

Evan Schnittman is OUP’s Vice President of Business Development and Rights for the Academic and USA Divisions. His career in publishing spans nearly 20 years and includes positions as varied as Executive Vice President at The Princeton Review and Professor at New York University’s Center for Publishing. He lives in New Jersey with his wife and two children.